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Annual Results 2007: Strong Growth and Strategic Expansion in Restaurant Business

In 2007, the restaurant sector experienced a remarkable 19.6% growth in turnover, with 30 new restaurants launched, expanding the base to 333 sites. Key brands, including Spur Steak Ranches and Panarottis, demonstrated solid financial performance despite rising food inflation. Strategic enhancements such as menu engineering and targeted promotions were implemented to maintain customer engagement. Looking ahead, the focus remains on further growth with plans for new openings, revamps, and enhanced value propositions across various locations, ensuring a robust future trajectory.

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Annual Results 2007: Strong Growth and Strategic Expansion in Restaurant Business

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  1. Annual results2007

  2. Performance& operationsPierre van Tonder

  3. Highlights of the year • Strong growth in restaurant turnover of 19.6% • Opened 30 new restaurants (Spur: 22, Panarottis: 4, John Dory’s: 4) • Restaurant base now 333 • Entrenched position in family sit-down restaurant market • Solid financial performance, boosted by tax credit

  4. Spur Steak Ranches • Turnover growth • 16.6% - all restaurants • 13.0% - same restaurants • High food inflation • Customer impact minimised by menu engineering, promotions & procurement focus

  5. Spur Steak Ranches continued • Number of restaurants grown by 22 • 16 in SA & 6 International • Relocated 6 restaurants • All showing turnover growth in excess of 20% • 21 restaurants revamped • 203 since revamp programme started in 1999 • Add an average of 10 - 15% to existing business • Total restaurants now 253 in SA

  6. Spur Steak Ranches continued • Broadening base in SA • Umlazi Mega City, Umlazi (in 2006) • Jabulani Mall, Soweto • Carlton Centre, Johannesburg • Trade Route Mall, Lenasia • Maponya Mall, Soweto • Future sites include: • Mamelodi • Guguletu • Kwa-Mashu • Secret Tribe Kids Club grown by 11.9% • 819 985 active members • New cards to be activated

  7. Spur Steak Ranches continued • 12 new restaurants planned for 2008 • Further 20 restaurants to be revamped • 4 relocations planned for 2008 • Continued growth in existing business, value for money proposition is critical

  8. Panarottis Pizza Pasta • Turnover growth • 17.2% - all restaurants • 15.0% - same restaurants (impacted by store closures) • Menu price increase of 8% • New marketing campaign in cinemas • Focused growth plan

  9. Panarottis Pizza Pasta continued • Number of restaurants grown by 4 • 2 in SA & 2 International • Upgraded 13 restaurants • Total restaurants now 60 • New menu introduced in March 2007 • Expect to open 4 new restaurants in 2008 • Continue aggressive marketing campaign

  10. John Dory’s Fish & Grill • Number of restaurants grown by 4 • Total restaurants now 20 • Décor & design upgraded • Introduction of sushi as a main menu item • 4 new restaurants planned for 2008 • Focusing on high density trading areas for growth

  11. International • 8 new restaurants • Gaborone, Windhoek, Swakopmund (Spur) & Harare (Panarottis) – increasing the African footprint • Erina Fair (Spur) & Blacktown (Panarottis) (Australia) • O2 Dome & Lakeside (London) (Spur) • Total restaurants now 34 • 27 Spur • 15 Africa (incl. Mauritius) • 12 International • 7 Panarottis • 3 Africa (incl. Mauritius) • 4 International

  12. International continued • United Kingdom & Ireland • Opened 2 company-owned restaurants • Franchise restaurant opened after year end • In negotiations with UK master franchisee • Australia • Operations restructured • 2 - 3 new restaurants scheduled • Africa • Spur brand gaining impetus • 3 new restaurants planned • Middle East • Currently under negotiation

  13. Operations • Success of Taste FM in-house radio station • Benefits of locked-down POS roll-out • Supply chain initiatives • Critical path for franchisee profitability • Consistency & quality in restaurants for customer • Partnerships with suppliers • IP initiatives i.e. labour – new laws • Continued improvements in Vector service & increase in restaurant participation

  14. Financial performanceRonel van Dijk

  15. Key financial indicators

  16. Turnover

  17. Turnover – geographic split

  18. Operating income

  19. Comparable profit after tax

  20. Balance sheet – assets

  21. Balance sheet – equity & liabilities

  22. Cash utilisation

  23. Outlook for 2008Pierre van Tonder

  24. Outlook for 2008 • Rising interest rates & introduction of NCA to impact consumer spending, value is critical • Food inflation continues to be a challenge • Continued restaurant growth in SA • Selective international restaurant openings • BEE evaluation completed • Strategy being developed • IDC facility to support black franchisees across brands • Review of dividend policy • Sustained revenue & profitability growth in 2008

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